Bearing the burden of credit card debt isn’t only financially perilous, it’s also mentally taxing. Financial stress can affect anybody, no matter their wealth status, but people with debt tend to stress out the most, unsurprisingly. A CNN survey found 76% of households live paycheck-to-paycheck and are piling on credit card debt. Of those surveyed, 71% said money was a stressor in their lives.
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Financial guru Suze Orman has enormous empathy for people in debt. Her own rags-to-riches story suggests she can relate to their struggles. She’s determined to help us break free from the credit card debt that is weighing us down and holding us back.
In a new blog post on her site called “What You Really Need To Do In 2025,” Orman expounded on the augmenting threat of debt — particularly as it pertains to those in or nearing retirement — and explained the No. 1 way to resolve it or prevent it from getting worse.
Credit Card Debt Is Growing Among Retirees
“I was so frustrated to see the news that among retirees with debt, more than two-thirds said they had credit card debt, a big increase from prior years,” Orman wrote. “If you are nearing or in retirement, and find yourself carrying credit card debt, I hope you will revisit one of my keys to financial security.”
So what is this key to financial security that Orman champions? Let’s get into it.
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Focus On Needs — Not Wants
A lot of Americans are cornered into taking on credit card debt because they’re not making enough money. Retirees who didn’t save a boatload of cash and invest aggressively in their younger years are particularly at risk. But people also get into or worsen credit card debt by prioritizing not only needs but also wants.
It’s of critical importance that you focus on needs far more than wants.
“This is just as true if you are 65 as when you are 25 and trying to figure out how to live within your means for the first time,” Orman wrote.
To embrace the financially savvy philosophy of putting needs well before wants sounds pretty simple. But have you ever really dedicated yourself to this practice? It’s actually difficult to successfully pull off in a consumerist society. Orman provided some tips on how to do it.
Do You Need To Spend That Much on Your Needs?
Yes, you need food and shelter. But do you need the food from DoorDash and the shelter provided by the biggest house on the block? Well, no.
“For every spending item that is a need, I am going to ask you to consider if you actually need to spend as much as you are currently spending,” Orman wrote.
Scour Your Credit Card and Bank Statements To Remove ‘Wants’ Spending
You have to be aggressive with budgeting, and to get started there, you need to fearlessly study your bank and credit card statements. As you do that, add up the weekly or monthly costs of your “wants,” per Orman’s suggestion.
“You are plenty experienced at this, so you know the assignment,” Orman wrote. “Ask yourself if you could eliminate those wants, if only temporarily. Or maybe cut the amount spent on those wants by 50%. The goal, of course, is to reduce your spending so you have more money to put toward paying down your expensive credit card balance.”
Keep Yourself in Check Before Buying Anything
Look at that fantastic cashmere sweater on sale at Gap. You definitely need that because it’s cold out and you don’t own any cashmere and have never seen it available for such a low price. Stop yourself right there and do what Orman recommended, “a quick mental run-through of whether it is a need or a want.” You may really like that sweater and can picture the ways in which you will use it, but you may not actually need it.
Re-Evaluate What You Think of as ‘Needs’
This ties into Orman’s next point: Reconsider what you think is a need. When you’re in or nearing retirement, needs can change and possibly even shrink.
“I think as you age, it can also be helpful to push yourself to explore what you consider a need,” Orman said. “Just because you needed two cars when you both were working and raising kids, might you be able to manage just fine with one car for the house? Just because you needed to keep your wardrobe fresh when you were working, do you really need to spend as much as you do now on new clothes?”
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This article originally appeared on GOBankingRates.com: Suze Orman’s No. 1 Tip for Tackling Credit Card Debt If You’re In or Nearing Retirement
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